Seven Star, Inc. v. United States

Citations: 933 F.2d 791; 1991 WL 82376Docket: No. 90-55596

Court: Court of Appeals for the Ninth Circuit; May 22, 1991; Federal Appellate Court

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Seven Star, Inc. and Elluz Corporation (collectively referred to as Seven Star) appeal a district court ruling that granted summary judgment in favor of the government defendants, specifically challenging the court's conclusion that no genuine issues of material fact existed regarding their retaliatory prosecution claim. The background involves Seven Star's application for 500 'H-2' temporary worker visas for foreign dancers, which was denied by the Department of Labor on October 21, 1987. Following the denial, an article in the Los Angeles Times on October 28 highlighted the visa request and criticized the hiring of illegal workers, prompting a California subcommittee hearing where Assembly Member Richard Floyd made derogatory remarks implying the dancers were akin to prostitutes. In response, Bill Carroll from the INS assured that there was no intention to allow the importation of prostitutes and indicated an investigation into the ballrooms would begin. The INS cited the Times article as the catalyst for their investigation, believing that a request for such a large number of foreign workers suggested current employment of illegal aliens. Seven Star contended that the embarrassment faced by Carroll at the hearing led to their targeted enforcement. Subsequently, on November 7, 1987, the INS visited the ballrooms, followed by Notices of Inspection served on November 10. Prior to these inspections, Seven Star filed a lawsuit seeking to halt government action against their ballrooms until the review of their visa petition was completed, but the district court denied this request, a decision later affirmed by the Ninth Circuit.

On the same day the district court ruled against Seven Star in a prior action, Seven Star filed a new complaint alleging selective enforcement of immigration laws by the INS, which investigated only its five ballrooms despite there being eleven in proximity. Seven Star claimed this selective enforcement violated its Fifth Amendment rights to due process and equal protection, seeking injunctive and compensatory relief, along with punitive damages. The district court granted the government's motion for summary judgment, leading Seven Star to appeal on the sole issue of whether the court erred in granting this judgment concerning its claim of retaliatory enforcement. 

The appellate review is conducted de novo, assessing whether any genuine issues of material fact existed and if the law was correctly applied. Seven Star argued the INS's investigation was retaliatory, linked to its application for 500 H-2 visas and the embarrassment of an INS official due to public criticism. To establish a claim for retaliatory prosecution, Seven Star needed to demonstrate both a lack of prosecution for similarly situated parties and that the investigation was motivated by an impermissible reason, such as retaliation for exercising protected statutory rights.

The court found Seven Star failed to provide sufficient evidence to create a genuine issue of material fact regarding the INS's motivation for the investigation. An LA Times article suggested that the investigation was justified due to the reliance of hostess dance ballrooms on illegal immigrant labor and Seven Star's recent visa application. The court concluded that the involvement of a legislative member in prompting the investigation did not render the INS's motives impermissible. The appellate court affirmed the district court's decision, noting that while Seven Star raised claims of selective enforcement at trial, it adequately asserted both selective and retaliatory enforcement in its arguments. The opinion also acknowledged, without deciding, that a claim for retaliatory investigation could exist, although all cited cases pertained to criminal prosecutions.